TD Cowen, UBS Boost Southwest Airlines Targets as YTD Performance Hits 15.5%
TD Cowen upgraded Southwest Airlines to Buy and raised its price target to $66, while UBS lifted its target to $73 after forecasting incremental EPS of $4.25–$4.50 from new fees. Year-to-date returns for Southwest stand at 15.5%, outperforming the Transportation sector’s 13.6% average.
1. Analyst Upgrades and Price Targets
TD Cowen upgraded Southwest Airlines to Buy and raised its price target to $66 from $50, citing strengthening 2026 demand and disciplined capacity. UBS likewise upgraded to Buy and lifted its target to $73, forecasting $4.25–$4.50 in incremental full-year EPS from extra legroom, assigned seating and checked bag fees.
2. YTD Performance and Earnings Outlook
Southwest Airlines has gained about 15.5% year-to-date, outpacing the Transportation sector’s 13.6% average. Over the past three months, consensus full-year earnings estimates for the carrier have risen 57.3%, reflecting improving analyst sentiment and a positive outlook.
3. Starlink Connectivity Expansion
The airline plans to equip more than 300 aircraft with high-speed Starlink in-flight connectivity by the end of 2026, with the first jet entering service this summer. This satellite upgrade is expected to enhance passenger experience and support growth in ancillary revenue streams.